BIRMINGHAM – A federal grand jury today indicted a Birmingham man for preparing false income tax returns and for intimidating witnesses who the Internal Revenue Service contacted to question about returns he had prepared, announced U.S. Attorney Joyce White Vance and IRS Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot.
An 11-count indictment filed in U.S. District Court charges DONALD E. STEELE, 41, with seven counts of aiding in the preparation of a false federal income tax return in 2010 or 2011, and with four counts of witness tampering in 2011. At the time, Steele operated Max Tax, a Birmingham tax return preparation business owned by his wife.
Steele is charged with making false claims and fabricating tax deductions on federal tax returns for five different taxpayers. Among the charges is that, in 2011, Steele prepared a 2010 tax return for “H.N.D,” fraudulently claiming an exemption for her disabled dependent brother, identified as “K.L.,” when Steele knew that K.L. was H.N.D.’s boyfriend and not disabled. Steele also claimed a $1,000 “American opportunity” tax credit based on a false claim that K.L. was a student and had incurred $4,000 in education expenses during the 2010 tax year.
In the witness-tampering counts, Steele is charged with calling K.L. about seven or eight times after learning IRS agents were inquiring about the preparation of H.N.D.’s 2010 tax return and telling K.L. to lie to the agents and tell them that Steele’s wife had prepared H.N.D.’s return.
Two other counts of the indictment charge Steele with preparing returns for “A.E.T.” for the calendar years 2009 and 2010, falsely claiming business losses for the taxpayer when she was not self-employed in either year and did not provide Steele any information pertaining to self-employment. Steele claimed a net business loss of $12,049 for A.E.T. in 2009 and a net loss of $11,938 in 2010, according to the indictment.
In another witness tampering count, Steel is charged with contacting a former tax preparer at Max Tax and telling her that if IRS agents contacted her, she should withhold information and tell them that he did not prepare any tax returns, that his wife prepared and transmitted the returns.
The maximum penalty for aiding in the preparation of a false federal income tax return is three years in prison and a $250,000 fine. The maximum penalty for witness tampering is 20 years in prison and a $250,000 fine.
IRS-CI investigated the case, which Assistant U.S. Attorney J. Patton Meadows is prosecuting.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
